An Introduction to International Investment Law by David Collins

Author:David Collins
Language: eng
Format: epub

6.3.2 Unlawful Expropriation

As noted above, confiscation is the most offensive form of unlawful expropriation. It contemplates situations where property is taken without a public purpose (meaning that it serves only the personal interest of the governing authority) and for which no compensation is paid. Only one component of the above four-stage test need not be fulfilled in order for the expropriation to be considered unlawful. The practical distinction between a lawful and an unlawful expropriation is in most instances meaningless because the same standard of compensation is generally applicable to both kinds of takings. The often subtle differences in compensation for legal and illegal takings will be considered further in the next chapter. For now it is enough to mention that an unlawful expropriation (meaning one that does not observe all four of the criteria specified above) should be viewed as a treaty violation, in other words a breach of international law. Under customary international law, breaches of international law trigger a state's duty to engage in reparation for their wrongdoing. Such reparation, as will be examined further later on, is better described as damages rather than compensation because it connotes a misdeed, which is precisely what is envisioned by the failure to uphold the four conditions specified in most IIAs.

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